01/06/2012

Brazil’s Compensation Fund

Brazil recently proposed plans for a project that will allow rich nations to compensate for developing nations’ efforts to reduce carbon emissions from deforestation, which is responsible for nearly a quarter of the world’s total carbon emissions. The project will focus on slowing down the rate of deforestation and land-clearing in Brazil’s Amazon rainforest, which has already lost “an area twice the size of Germany” due to deforestation. The idea is for rich nations to contribute money to a fund for developing nations who have achieved a drop in the environmental impact of their deforestation industries. The money will only be accessible to developing nations “after they prove they have slowed initial deforestation rates.”

The project developed as a way to address certain issues in 1999’s Kyoto Protocol, which allowed developing nations to essentially be exempt from the Protocol’s requirements because they were not significant contributors to carbon emissions. With the new plan, developing countries will have monetary incentive to reduce their emissions. Critics of this new plan argue that participating nations should not be paid for their emissions cuts, and instead should be included in the Kyoto Protocol requirements. Proponents of the plan claim that it will benefit both developing nations–who will gain resources–and developed nations–who will meet their requirements in the Kyoto Protocol.